Defining the goals of a business provides any organization with a clear pathway towards attaining its set targets, be they financial or non-financial. Target goals for organizations are not only internal but also external particularly for external stakeholders like investors and customers, while non-profit organizations’ external stakeholders include donors and their clients.
A business plan not only states the goals but the reasons why they are viewed as achievable, and the road map towards their implementation – it is a mission statement for the non-profit and some government agencies.
Marketing plans are another form of business plans and they aim at boosting perception and branding. Internally focused business plans deal with the intermediate targets need to attain external goals, like the provision of new services, IT system, organizational restructuring or the introduction of new product lines.
Success of a business plan is measured through its balanced scorecard or list of success factors, which transcend non-financial targets
Separate departments outline their goals through operational plans and specific projects are catered for through project plans, and strategic plans define generalized guidelines relating to internal goals.
Formatting of business plans relies on its specific targets and audience, for example, a business plan for a company that deals with debtors will aim to clarify the issue of repayments.
A business plan for a new business venture that requires equity financing must outline current resources, upcoming growth opportunities and its competitive edge, thus enabling a high exit valuation.
Different aspects of a business contribute varying strategic angles to an entities’ overall business plan such as finance, intellectual property management, supply chain management, operations management, marketing and human resource management.
In principle, business plans offer an easy to understand and yet attractive overview of a company’s objectives and the technical parameters at which it aspires to achieve its goals.
You can structure your business plan in any way you choose but the typical format includes an executive summary, business description, business environment, analysis, industry background, competitive analysis, market analysis, marketing plan, operations plans, management summary, financial plan, attachments and milestone.
It is critical to draw well balanced cost and revenue estimates to avoid the predicament of revenue shortfalls and cost overruns usually precipitated by biased optimism and strategic misrepresentations. Investors can be well informed of any negative elements to a business through an externally targeted business plan by listing all legal concerns and financial liabilities.